NFT is a market that has been rapidly expanding all over the world in recent years. This market is expanding so fast that many people still don’t know. Therefore, there is a term called royalty, but many people do not understand how it works.
What is royalty?
Royalty in NFT resale is a reward that part of the revenue enters the creator when the sale occurs. Every time secondary distribution is done, it is a mechanism that automatically pays to the creator each time. Secondary distribution means resale by the purchaser of the NFT to another person. For example, if an NFT with 10% royalty is resold for 1,000 yen, a royalty of 100 yen will be paid to the NFT creator. Every time the NFT is resold, the creator will receive a “royalty” each time.
What is secondary distribution?
Secondary distribution is a term that refers to the flow of NFT works to other people. Secondary distribution has a great advantage for authors, and there is an advantage that continuous income can be expected for creators. When you think of resale, you may think of second-hand books and second-hand clothes, but in the case of NFT, there is a profit for each circulation, so it is delicious.
What is the royalty rate?
NFT has suddenly expanded in recent years, so the market is not stable yet. However, it tends to be 3% to 10%. The reality is that it varies greatly from project to project. Of course, market instability is still the biggest factor behind this wide range. This rate is subject to change, so please check back from time to time.
Benefits of NFT royalties include:
low selling price
The existence of royalties makes it easier for the initial NFT price to be set low. Among the creators of NFT projects, there are many people who dare to sell cheaply at the time of the first NFT sale and want to earn royalties after that.
Royalties are paid for each resale. NFT royalties can be expected to generate continuous income, so if the project is successful to some extent, there is an advantage that the income will continue for a long time.
Notes on secondary distribution
A point to note about secondary distribution is that it depends on the NFT marketplace. Whether or not secondary distribution products can be listed depends on the marketplace, so it is necessary to check in advance.
Bybit’s NFT Marketplace
Bybit has an NFT Marketplace. If you open an account, you can actually enter and trade, so let’s try it.